Penalty for unaccounted invoices requires a specific finding of willful suppression before it can be sustained.

Penalty under the Tamil Nadu Value Added Tax Act could not be sustained where the assessing officer confirmed it without a specific finding that the non-accounting of invoices was willful and deliberate. After inspection revealed unaccounted sale invoices and the tax was paid, the officer proceeded to penalty without recording the requisite mens rea-based finding. The absence of that finding rendered the penalty order vulnerable, so the penalty was set aside to that extent and the matter was remitted for reconsideration after hearing the assessee.

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Issues: Whether the penalty imposed in the assessment order could be sustained without a specific finding that the alleged suppression was willful and deliberate.

Analysis: The assessment arose from a deemed assessment under Section 22(2) of the Tamil Nadu Value Added Tax Act, 2006, after an inspection revealed two unaccounted sale invoices. The tax liability was paid at the time of inspection, and a pre-revision notice and reply followed. However, the assessing officer confirmed the penalty proposal without recording a finding on whether the non-accounting of the invoices was willful or deliberate. Since penalty requires such a specific finding, the absence of that finding rendered the order vulnerable.

Conclusion: The penalty order could not be sustained as passed and was set aside to that extent, with the matter remitted to the assessing officer for reconsideration after hearing the petitioner.

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